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jones_supa writes "Today Epic launched Unreal Engine 4 for game developers. Supported platforms are Windows, OS X, iOS and Android, with desktop Linux coming later. The monetization scheme is unique: anyone can get access to literally everything for a $19/month fee. Epic wants to build a business model that succeeds when UE4 developers succeed. Therefore, part of the deal is that anyone can ship a commercial product with UE4 by paying 5% of their gross revenue resulting from sales to users. This gets them the Unreal Editor in ready-to-run form, and the engine's complete C++ source code hosted on GitHub for collaborative development."

UDK used to be free to play with. It's exciting until you realize there's a subscription attached and if you build a game with it 5% of the gross. That doesn't sound like much but when you stack it on top of the ~30% gross from your preferred sales channel, plus the fees from whatever other middleware you might want (Scaleform, FMOD, Bink, and Havok come to mind) and then add taxes, you're struggling to break even.

then don't license everything under the sunor buy your software upfrontor write your own engine. go start an open source game engine project that supports all the new hardware tech before it comes out and see how it works out

I don't see what you mean. Assuming revenue of 100 and 40% expenses (taxes, sales channel), 5% of gross is 5 bucks, but 5% of net is only 3 bucks. 2 bucks difference on the bottom line may not sound like a lot, but scale it up and it starts to matter more.

Since it seems I'm misinterpreting what you said, could you please clarify?

However I understand if you have to remove 'some fixed' costs at various stages the amount of fixed costs varies...

Great, because that's exactly what "gross" and "net" mean. Costs are removed in stages, with one set of costs being removed from your gross, and another set of costs being removed from your net. At each stage, the amount of money you have left will obviously be lower, so it's more desirable for you to have people take their percentage cut out of the later stages, since that will mean that more of the original pie will be left for you.

For instance, pretend you grossed $1000 and that your only other expenses

How much of a game sale do you think game developers get from a retail box on a shelf, after they've covered the cost of paying the publisher, the manufacturer, the shipper, the store, and any other middle men I'm forgetting? A damned sight less than the 70% that Apple gives you on their app store. Or Valve gives you on Steam.

Not that this has anything to do with the topic, since I brought up Apple's gouging model simple to point out to the other poster that gross and net are VASTLY different things, but you're comparing the 43% makes in comparison to the developer of the actual software to the amount a storefront makes off your product when it's on the shelf?

Apple is a storefront only. No games/software store in the world has a 30% markup.

Apple does virtually nothing for their 30% cut. You seem to be trying to include publish

Apple does a lot which makes it for simple minded people easy to sell/distribute software (and books).It offers you a 'store system' for free, you can upload upgrades, you have cathegories to put your software into, users can rate it, comment it, you can do in app adverticing and in app purchases, everything via a platform which is basically free. If you had to set that up your own you spent more time setting up your sales and billing infrastructure than it takes you to craft your first App.On top of that:

Its 5% of GROSS not net, so it really ought to be labeled as more than 35% because they are getting their cut before a single one of your costs is figured in.

I know being a little shop owner I don't care what you offered me if it were for a % of the gross? Kindly do piss off. oh and UDK used to be 100% Free to download and play with so its actually worse than it was before as it'll cost you a $20 to even try the thing.

I have a feeling that while they may get some indies (who don't know the difference betw

The pricing is targeted at indy devs; large developers who routinely gross 8 or 9 figures on games will not be paying for it this way, and if Epic thinks they will I suspect they're in for a surprise.

The only people who will get burned by this deal in reality are the very few low-budget indy games that hit enormous success -- think Minecraft, Braid, etc. For the vast, vast majority of indy games, 5% of gross is far less than the one-time fee for licensing a top-notch engine.

Actually, the 'big hit' indie developers will get burnt by this new system a shit load less than the previous UDK system. The previous UDK system was 25% net, with the first $50k free. Assuming 30% fees on top of UE fees, the new system equals the old system at $400k gross revenue, and from that point on is just flat out cheaper than the previous one.
Obviously the new system gets worse the higher additional fees you have, but on the flip side, the lower your additional fees, the more attractive the new sy

I agree. The old UDK licence was absolutely wonderful as long as you didn't hit the revenue threshold - then suddenly became crippling. Meanwhile, Epic earned nothing until the threshold was hit. This is a definite improvement for both Epic and for commercial licensees... although the subscription fee does add a barrier for hobbyists and freeware-authors compared to the old arrangement.

I really don't know the indie game industry very well so I don't know what constitutes "mildly successful", but based on the numbers given, the break-even point is $5m-$10m (so that 5% is $250k-$500k)... So if your expected gross income from the game is less than $5 million, then this is a good deal, and if not, it's a bad deal.

Even if your expected gross is $10 million over the life of the game, if that's made up of $2 million a year for 5 years, this might be an attractive option given the following choi

Most indie games don't make anywhere near this much money. Giving up 5% of revenue and a tiny up front cost is a much better deal for the majority of indie devs than taking the risk on fronting $250,000 up front when their game might not even get that much in revenue.

Obviously, it's a decision the developer needs to make early on, but the kind of people this deal is aimed at are those that are operating on a small budget. Say for example your break even point on costs on a small team was $250,000, and $50

Why would it cost any more than the 20$ a month, where are you getting this "250,000" dollars from? All you need is a couple programmers, maybe 3-4 artists who enjoy this sort of thing, if you pay people 30 grand a year to make an indie game sorry, but if you think the indie games industry is full of talent people who want to work for nothing you're an idiot. Those that can produce something are going to publish themselves and enjoy the spoils, those that can't aren't worth hiring.

or do what they did in the 90's, code your own engine for every game you makeor pay the thousands of $$$ upfront to Unity for their engine

this is where you have to make a good game and not just a copy of the latest IAP crap in the app store or some FPS. unlike 20 years ago people are willing to license you lots of software for no upfront fee and all you have to do is make an awesome game.

they are taking most of the financial risk of losing lots of money you may have invested in your project and you're still

https://store.unity3d.com/ [unity3d.com]$1500 gets you the pro version, or $75 a month. That's not thousands.Android and iOS are another chunk of cash each but are not required unless you're targeting those pro features.

Of course you can use and release free if you don't need the pro features...

And what financial risk are they taking? If I make a game and it flops badly with no sales they are still ahead by my monthly subscription.

you can always start up a company with a few hundreds thousand $$$ of your own money and have it fail and lose it all. Epic is giving you software to make a professional product with very little upfront cost

You can't develop a commercial game with Unity Standard though. Even if you're a single developer, the watermarking is a but of a put off. Sure you could develop for years and then just license to purchase, but that isn't likely a 28 person teams biggest concern.

A watermark? I haven't built anything with unity but all I can find is as long as you make less than $100k/year you can build and release with free with just a required splash screen.

And even if unity suddenly does become an overpriced piece of junk, there's other game engines including a good number of GPL and MIT licensed free ones.For the hypothetical 10 man team looking to break into the market with no money to spare for a big license, there are alternatives. And if they refuse to do without the extra p

And if you made your game with a GPL licensed engine you would have to release your game for free. Sure, you could charge for it, but any jerk with an internet connection could upload it to the 2nd hit on Google and because of the GPL license you used you would have no legal grounds to sue them, or even issue a takedown request.
As for the Unreal engine, it offers far more than "pretty rendering". What would you suggest a team use, Irricht, Ogre? I guess you expect a couple programmers to write their own t

There is no Watermarking in Unity. There are commercial games developed in standard Unity just not high quality games for the most part but there are some of those as well, there are plenty of high quality Unity Pro version of games.
Aside from lack of real time shadows and the like the only mark is the powered by Unity splash screen during initial loading of the game that is only up a couple seconds.

I really doubt a AAA with a 300 person team is going to purchase a game engine for a multi-million budget AAA title by going to a publicly accessible web store and queuing up 1 pro license + 299 team addon licenses and plunk down a credit card for that $151,000 bill.Just guessing here, but the same sales team that processes their console licenses will probably give that AAA different licensing prices and terms for a huge order like that.

What I find interesting is that the slashdot sqwark of outrage over unreal charging 5% seems to ignore that the 'sales channel' of Apple, Google or Valve's stores is more like 30%, yet no-one seems to care that 5% for writing a good-quality isn't such a bad deal.

If you want to complain about costs - take umbrage with the sales channels that happily cream a fucking third of your revenue away for doing little more than hosting a download site.

"Currently there is no planned trial or free version of Unreal Engine 4. If you would like, you can make a one-time purchase for $19 and then cancel your subscription to give it a try. You do not have to pay the subscription to use the engine, just to get the initial download, updates and additional content. There are two different builds you can download from this, one of which does not have access to source code and on

Unreal has had some good licensing terms for years. Three years ago, I their offer was 25% of sales and your first $50,000 of income is free (i.e. you owed nothing to Epic if your game grossed less than $50,000).

If Epic demonstrated the capabilities of this engine by also having a first-party game released along with it. They could make it a multiplayer first person shooter, which I know is a well-trodden field, but I really think Epic could do it - especially one that includes LAN play, which seems to be poorly represented in games these days. And then, they could bundle a few of the tools with the game so that some gamers could make their own content for it, and do something really earth-shattering - user-generated DLC, FOR FREE!

Things have gotten much better in gaming as of late, but also a hell of a lot worse. A few titles have come out lately that actually have full editors and SDKs, but it's still a far cry (hurr hurr) from where it was at one point. I loved the Unreal Engine, but there came a point (with Deus Ex 2 and the post-Raven Shield Rainbox Six games) where UE titles stopped shipping with editors, and I found myself getting very little mileage out of them. And then of course Epic went from having fairly great Linux supp

Things have gotten much better in gaming as of late, but also a hell of a lot worse. A few titles have come out lately that actually have full editors and SDKs, but it's still a far cry (hurr hurr) from where it was at one point.

Well, the fact of the matter was that CoD and Battlefield proved that it's far more profitable to released a game with a dozen maps, then charge $15 a pop for a half a dozen new maps every three months, than to equip players to make their own and circulate them around the internet for free.

What bothers me the most is the complete lack of LAN play. Everything wants you to make an account and join a server and do all this matchmaking crap, when all I want to do is play against my friends, in the same room, by

Right, and that makes it hard to be profitable for a company like Epic. They want to produce the game, then sell it. It's all these other developers that want a never ending revenue stream and that takes constant attention. Those sheep need sheering.

No, arena shooters are ones where you spawn in random locations, run to grab guns and gear, move relatively quickly, and tend to have little incentive to not shoot(such as long reload times, precision weapons, stealth). With a tendency towards more explosive weaponry and "arena" styled battlefieds. It's a subgenre thing.

Personally I agree - UT was fun when it came out, but the concept gets pretty boring after a tick. Then again, I've noticed a number of newer games, mostly "freemium," that seem to follow at least a modified version of the arena shooter model - Dust 514 and HAWKEN immediately spring to mind (although, to be fair, I haven't actually played HAWKEN, so I could be dead wrong about that one).

"I haven't actually played HAWKEN, so I could be dead wrong about that on"

You're not. It's pretty much an arena shooter with some of the addition option of some more modern FPS modes (capture the silo, etc), and exp-gathering to build upgrades (with the option to pay for them instead, of course).

Totally agreed. My friends and I still play UT2k4 on a weekly basis. With the Heaven of Relics mutator and some of the great Community Bonus Pack maps, it's still fun, ten years on. As it came out March 16, 2004, happy Tenth Anniversary UT2k4!

Really exicited to see if they port this to Firefox. They have already ported [mozilla.org] the version 3 of the Unreal Engine to Firefox, using OpenGL for graphics and Asm.js for code. The speed difference compared to the native version should be very small to non-existent, since Asm.js is statically compiled.

According to the UE4 EULA: "However, cancellation of your Subscription will not affect your rights under the License with respect to any Licensed Technology you have already downloaded under the License."

The $19 a month is likely just for covering the costs of hosting and distributing the source code, binaires and documentation. You'd be paying for the continued convenience of accessing those anytime, the studio's clearly not intending to get rich over those subscriptions.

From a laypersons perspective (by that, I mean not a programmer) this strikes me as reasonable.They are creating a sophisticated tool (is anyone going to dispute that it is, in fact, somewhat sophisticated?) for what appears to me an eminently reasonable figure, and a small haircut at the end of the process.
You don't really want an EA hegemony forever surely?

5% of gross turns out to be 30-50% of net gain for most developers (unless you're Blizzard or EA). That's what's causing the controversy.

The alternative, from EA's perspective, is accounting hell. Suppose you say that it's 10% of "net gain". Most would consider it reasonable to consider payroll something that would be deducted before EA's share, but suppose you're a single-op game developer, and you make a game that grosses $100,000. Suppose that after you've paid for your website, your bandwidth, your equipment, your Amazon EC2 instances, your Visual Studio licenses, refilled your Google AdWords account, and paid your electric bill, you've

Epic's terms for 4 are quite affordable, that's why we made the move to 4 from three for City of Titans after our Kickstarter last year. These terms are very positive for those seeking to deal with a top end game engine which is, simply, a joy to work with.

$19/month honestly isn't that bad for what you're getting. I'm a member of a few indie dev communities, and I've seen what pre-release versions of the engine can do. It's very impressive, and one guy can do a whole hell of a lot more by himself in a month than he used to be able to, and make it look good in the process. However, I can't help but think they'd have a bigger market share if they used the old pricing model instead. It used to be free to play with, and free to sell games with unless you made over $50000usd. On the other hand, I doubt the decision was made arbitrarily. These guys watched the market, and saw how their engine was being used. I'm guessing a lot of indies had games that didn't make it to the $50k mark, so much so that a subscription cost is better.